Nissan set to meet to decide chairman's fate

Nissan’s board will meet today to decide whether to dismiss its chairman Carlos Ghosn following his arrest on suspicion of under-reporting his income.

Mr Ghosn will be detained for another 10 days following his arrest on suspicion of falsifying income reports by millions of dollars and misusing company assets for personal gain, Japanese media has reported.

Under Japanese law, suspects can be held for 20 days per possible charge without an official indictment. Additional charges can be tagged on, resulting in longer detentions.

Mr Ghosn is suspected of under-reporting £34.8m in income from 2011 to 2015, according to Tokyo prosecutors.

The maximum penalty, upon conviction for violating finance and exchange laws is 10 years in prison, a 10 million yen (£69,000) fine, or both.

Detainees undergoing interrogation in the Tokyo area are generally held in a centre that is separate from the prison for those who have been convicted and sentenced. It is supposed to be nicer than a prison but it is austere with limited access to outside visitors.

Prosecutors have not confirmed where he is being held. Despite the arrests, analysts said the impact on Nissan’s sales would likely be minimal.

“I’d be surprised if it impacts car sales very much,” said Christopher Richter, auto analyst for CLSA Securities Japan.

“Consumers are discerning enough to say: This car, the wheels might fall off so I’m not going to buy it. This car company, the executive might have done something kind of dodgy, but do I like the car or not.”

Nissan Motor Chairman Carlos Ghosn (Image: Getty Images)

8.53Coreena Ford

Model train maker Hornby 'slams brakes' on discounting

Hornby has seen half-year losses narrow after “slamming the brakes” on an aggressive discounting strategy that was eroding sales.

The troubled toymaker posted a pre-tax loss of £3.2m in the six months to September 30, down from £5.7m in the same period last year.

Hornby boss Lyndon Davies said the encouraging performance came after the firm ditched selling products on the cheap and focused on the “long-term health of the brands”.

He said:

Having slammed on the brakes as hard as we could to prevent further damage to the brands from discounting, the trust in the supply chain is starting to move in the right direction.

Perhaps most importantly, our loyal employees are beginning to believe in the business again. There are some incredible products in the pipeline that will finally get us back on the front foot and give us the ability to take back the market share that we have given away.

Group revenue in the period fell from £17m to £13.8m.

Hornby trains

8.45Coreena Ford

Mothercare sales falter amid tough trading

Retailer Mothercare warned that its financial performance will remain “volatile” as it reported a crash in UK sales. The firm posted an 11% decline in UK like-for-like revenues in the six months to October 6, while total sales in the country fell 14.3% to £196.2m.

The firm posted a pre-tax loss of £14.4min the period, a slight narrowing from the £16.8m recorded last year. Total group revenue, including international, was down 13.1% to £295m.

In the UK, retail store sales were down 13.8% and online sales dropped 7.8%.

Earlier this year, Mothercare launched an overhaul which saw it embark on a £32.5m share issue and sweeping store closures.

The babywear chain is shutting 60 of its outlets, including two stores in the North East, and it said that it was ahead of schedule with the closures.

Boss Mark Newton-Jones said:

Our international business is showing signs of recovery after a difficult few years, and some core markets, including Russia, China and Indonesia, have moved into growth.

The UK retail environment, however, remains very challenging and, given the ongoing uncertainty with consumer confidence, alongside the short-term impacts of our operational changes and restructuring programme, we expect performance in the remainder of our financial year to remain volatile.

Centrica reveals £70m price cap hit

British Gas owner Centrica has warned over a hit of around £70m from the incoming energy price cap as it revealed another 370,000 customers have quit the supplier.

Britain’s biggest energy provider said the earnings impact will be taken in the first quarter of next year, with the cap coming into force on January 1.

It said that while the ongoing impact of the cap is in line with previous forecasts, the regulator’s recent revisions to calculation changes meant it would take the one-off earnings hit in the initial period after the cap comes into effect.

British Gas lost another 372,000 gas and electricity accounts in the four months to the end of October as households switched suppliers amid intense competition and after the provider announced its second price hike this year in August.

The customer account losses came as it moved customers off standard variable tariffs (SVTs) ahead of the price cap.

British Gas has 3.1 million customers on its SVT, down from 4.3 million at the start of the year, and it expects this to reduce further to below three million by the end of the year. Centrica said that despite “competitive trading conditions”, it expects to deliver 2018 results in line with forecasts, with underlying earnings set to be higher than in 2017.

A gas hob with a bill from British Gas (Image: PA)

8.35KEY EVENT

Majestic Wine to stockpile ahead of Brexit

Wine retailer Majestic Wine has revealed it is stockpiling ahead of Brexit amid worries over possible supply disruption next March.

The firm, which has stores across the UK including in Hexham, Newcastle, Berwick, Durham and Darlington, detailed its preparations in half year results, which showed it had swung to a pre-tax loss of £200,000 from profits of £3.1m a year earlier.

The group warned it expects underlying earnings across its retail and commercial divisions to be flat “at best” in 2018-19 amid a “tough” market.

Its push to expand Naked Wines will also hit profits, with investment set to be more than expected at £20 million or higher over the full-year.

Majestic said it is are planning to bring £5-8m of additional inventory into the UK above its normal levels, shortly prior to its financial year end, “in order to mitigate any potential supply chain Brexit disruption in March 2019.”

It added: “We are also planning to build additional inventory to support future Naked growth, in the US in particular, reflecting our confidence in this exciting opportunity.”

Rowan Gormley, group chief executive, said: “We’re doing well in a tough market. “We set out a plan at our capital markets day in April 2018 and we are delivering against it. “That plan was to accelerate growth by investing in new customers and, so far, the plan is on track.”

Majestic said it was stockpiling. It said it is planning to bring £5 million to £8 million of extra inventory into the UK shortly before its financial year end in April.

Majestic Wine's chief executive Rowan Gormley

8.25Coreena Ford

Nationwide profits fall following tech investments

Nationwide Building Society has seen half-year profits tumble as it counted the cost of writedowns and a technology investment.

Statutory profit in the six months to September 30 fell over 17% to £516m, which it put down to £135m of “asset write-offs and incremental technology spend”.

Underlying profits were down by 22% to £460m. Earlier this year, Nationwide announced another £1.3bn technology investment as it looks to take the challenge to digital rivals.

At the time, the building society said the cash injection will help “simplify its technology estate and build new technology platforms to enable growth and diversification, and drive forward digital, data and analytic strategies”.

Chief executive Joe Garner said:

Our first-half profits were lower than last year because we have chosen to increase our investment in the future of our society. As a mutual, we do not judge our success by profit growth alone, but by how we manage our profits to serve our members’ interests.

Nationwide has been battling fierce competition in the mortgage market, but said it helped a record 40,500 first-time buyers purchase a new home in the first half of the year.

A Nationwide branch

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FTSE 100 and pound latest

The FTSE-100 index opened at 7050.23.

The pound at 8am was 1.2786 dollars compared to 1.2776 dollars at the previous close. The euro at 8am was 0.8917 pounds compared to 0.8917 pounds at the previous close.

London Stock Exchange (Image: PA)

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Prime Grey Street office and leisure building put up for sale with £13.6m price tag

Lloyds Court and 52-60 Grey Street has been put up for sale in a rare office and leisure opportunity on the grand street connecting the city centre with the Quayside.

The adjoining, Grade II listed buildings have 46,960 sq ft of office and retail space spread over five storeys of office space with retail or leisure units on the ground floor.

Originally built in the 1930s, the building has a host of diverse tenants including Northern Electric, Nigel Wright Consultancy, Las Iguanas and Sk:n clinic, which contribute to a passing rent of £1.012m.

Cushman & Wakefield’s Newcastle office has been appointed to find a purchaser for the asset, with offers being sought for in excess of £13.6m.

Lloyds Court and 52-60 Grey Street - adjoining buildings in Newcastle which are up for sale (Image: John Bairstow)

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Who is John Whittaker, the tycoon who wants to buy Metrocentre and Eldon Square?

The owner of Peel Group is part of a consortium also involving Saudi and Canadian business interests that could take advantage of intu’s share price falling over the last year.

Peel already owns 26.6% of intu, as well as stake in rival group Hammerson, whose putative takeover of intu failed earlier this year.

But who is Mr Whittaker, and what could the deal mean for the North East?

Born in Bury, 76-year-old John Whittaker was born into an independently wealthy, entrepreneurial family with interests in the cotton industry and property.

He very nearly became a Roman Catholic priest after studying at a Catholic boarding school in Bath but instead followed his family into business.

He became involved in the business in the 1960s and soon started buying up land around Manchester Ship Canal before building the Trafford Centre.

An astute businessman who is said to be publicity-shy, he is chairman of Peel Group which now owns shopping centres, ports, power stations, airports including John Lennon Airport and Durham Tees Valley Airport, and MediaCityUK.

Mr Whittaker has been at the forefront of the development of modern day shopping centres as an early advocate of how leisure should feature just as much as shops.

He opened the Trafford Centre in Manchester in 1998, introducing its vibrant mix of retail, cinema and restaurants to the public.

Then in 2011 he sold the Trafford Centre to intu – a deal which saw him join the board as chairman and gain shares amounting to 26.6% of the firm.

This summer he took a small stake in Hammerson, sparking talk that a deal for Hammerson to take over intu might be on its way. The deal - which had been set to create Britain’s biggest property company, with £21bn worth of assets across Europe - fell through, however.

A father-of-five, Mr Whittaker and his family live on the Isle of Man in Billown Mansion and over the last year his wealth increased by £50m, taking him to number 31 in the Sunday Times Rich List.

He was named the most influential Northerner by Big Issue magazine in 2010 thanks to his large investments in the North.

Our sister paper the Manchester Evening News named Mr Whittaker as one of the most influential business leaders for Greater Manchester and the North West.

It’s also been reported that some of his business dealings are unorthodox.

As a Manchester United fan, he and his Italian supplier agreed that the price of marble to be used at Trafford Centre would be based on the result of a football match between his team and Juventus. Thankfully a Ryan Giggs goal won the match and Peel Group was saved from spending a high price on materials.

John Whittaker, chairman of The Peel Group at Durham Tees Valley Airport

Metrocentre and Eldon Square owner Intu Properties has updated shareholders on a potential £2.8bn takeover - and we’ll know in a week if the bid is successful.

The group, which owns a raft of shopping centres around the UK and in Spain, announced that it had once again extended the deadline for the consortium, led by Peel Group tycoon and the firm’s deputy chairman John Whittaker to make a formal offer for the company.

The owner of Manchester’s Trafford Centre said that Mr Whittaker’s Peel Group and its Saudi Arabian and Canadian partners now have until November 30 to make a firm offer or walk away from Intu.

Intu said the consortium has largely completed its due diligence, with no reason to change its indicative proposal of 210.4 pence per share, which values the firm at £2.8bn.

The statement said:

The Consortium has confirmed to intu that its legal, tax, accounting and commercial due diligence is now largely complete and that it has made substantial progress on the financing of the possible offer. The Consortium has also confirmed that nothing has arisen from these due diligence workstreams which would lead it to alter the terms of their indicative proposal dated 17 October 2018.

The indicative proposal remains subject to certain pre-conditions, including the Consortium completing its financing arrangements with its lender group.

Accordingly, an extension has been granted.

The Consortium has until 5pm on Friday, November 30, to either announce a firm intention to make an offer for intu or announce that it does not intend to make an offer.